Melody Mashaire : Business Reporter
Barclays Bank Zimbabwe limited has set aside $20 million under a fund aimed at providing loans to Small and Medium Enterprises. The bank currently has a total of 5 000 SMEs on its books. Speaking at a young business journalist training programme, Barclays Bank Zimbabwe commercial director Lawrence Nyazema said the fund is meant to capacitate SMEs.“We now have a fully-fledged SME department, we do not want them (SMEs) to be in Harare only, we want to have some of them in Bulawayo and other centers because with SME’s it is about reaching out to the various small industries and players where ever they are.
“We have a fund where we want to push as much as $20 million to support SMEs that is one specific fund that we have just started rolling out.
“I have seen some small loans starting from around $5000, $10 000 and $20 000 that are now starting to come around on our book,” he said.
He added that some SME’s are failing because they do not have economies of scale.
“You have issues of economies of scale, some SMEs do not have economies of scale while bigger companies have economies of scale which makes it difficult for some SME’s to survive,” he said.
Government believes SMEs are playing a key role in the economy, employing about 60 percent of the country’s workforce and contributing about 50 percent of the country’s Gross Domestic Product.
Mr Nyazema urged SME’s to be financially disciplined.
“When we give you money as an SME, try to ensure that the money goes to the right place because we have certain instances of financial indiscipline.
“Financial indiscipline has been an issue. So those who were importing before Statutory Instrument 64, you would find that all of a sudden they will be struggling because all of a sudden there is a regulation that comes that takes you out of your business and out of your comfort zone and because our SME’s mostly rely on one product you would find that it is very easy for them to be taken out , not because they do not work hard but because their focus is on one product and some of them is due to natural causes,” he said.
He added that the bank will reach out to reach out to auditing firms so that they can work with SME’s.